The crime or act of willfully interfering with the process of justice and law especially by influencing, threatening, harming, or impeding a witness, potential witness, juror, or judicial or legal officer or by furnishing false information in or otherwise impeding an investigation or legal process
In the Mueller Report, Special Counsel Robert Mueller described 10 different types of acts by the President that could be considered obstruction of justice. In the Ukraine case, President Trump appears to have again obstructed justice in a number of ways:
Attempting to conceal evidence
Impeding witnesses and potential witnesses
Intimidating witnesses and potential witnesses
Intimidating members of Congress
Obstruction: Attempting to Conceal Evidence
The transcript of the July 25, 2019 call with President Zelensky raised concern for many when they heard it, including U.S. Lt. Col. Alexander Vindman. When Vindman saw the readout of the call, he noticed a couple of omissions, and submitted them to ensure that the call record was accurate. His submissions were not included, and the call transcript was quickly put on a top secret server in the White House that only six people have access to. The server is generally used only for information related to highly sensitive national security matters. Why did the record of such a “perfect call” need to be hidden away from others?
Shockingly, when asked for a transcript of the call, President Trump quickly made the transcript available to the public, despite its supposedly highly sensitive nature. Did the released version include everything that was in the version on the server? During testimony, Vindman was asked about the reason for the transcript being put on the top secret White House server:
“My understanding is that this was viewed as a sensitive transcript.”
U.S. Lt. Col. Alexander Vindman National Security Counsel Ukraine Expert, Director for European Affairs
Adam Schiff: “Both of you recall President Zelensky in that conversation raising the issue or mentioning Burisma, do you not?”
Jennifer Williams: “That’s correct.”
Alexander Vindman: “Correct.”
Adam Schiff: “And yet the word Burisma appears nowhere in the call record that’s been released to the public. Is that right?”
Jennifer Williams: “That’s right.”
Alexander Vindman: “Correct.”
Obstruction: Impeding Witnesses or Potential Witnesses
The President has made extensive use of the concept of “executive privilege,” claiming that it immunizes anyone in his Administration from testifying before Congress. Consistent with that logic, he has prevented a number of witnesses – some under subpoena – from testifying in the impeachment hearings. Among those witnesses and potential witnesses are:
John Bolton – Former U.S. National Security Adviser
Mike Pompeo – U.S. Secretary of State
Mick Mulvaney – ActingWhite House Chief of Staff
Rick Perry – U.S. Secretary of Energy
Mike Pence – Vice President
Obstruction: Intimidating Witnesses or Potential Witnesses
The President has made numerous threatening statements during the course of the impeachment hearings. Many of his statements were issued in plain sight on Twitter and Facebook, as they were during the Mueller investigation. If you do not perceive the quotes below as threatening, imagine yourself being the subject of such public pronouncements made by the most powerful man in the country – a man with legions of fanatical followers, some of whom have already become violent toward targets of similar statements that he has made in the past.
Intimidating the Person(s) Who Spoke to the WhistleBlower
“I want to know who’s the person who gave the Whistleblower the information because that’s close to a spy. You know what we used to do in the old days when we were smart with spies and treason, right? We used to handle it a little differently than we do now.”
Donald Trump President of the United States
(Speaking to his staff at the United States Mission to the United Nations on 9/26/19. America has executed spies in the past.)
Intimidating the Whistleblower
Intimidating Witness Marie Yovanovitch
“It’s very intimidating. … I mean, I can’t speak to what the president is trying to do, but I think the effect is trying to be intimidating.”
Marie/Masha Yovanovitch Former US Ambassador to Ukraine
Intimidating Witness Jennifer Williams
Intimidating Witnesses in General
Obstruction: Intimidating Members of Congress
Intimidating Rep. Adam Schiff (D-CA)
“Shifty Schiff – Little Shifty Schiff [audience boos]. He’s got the little, little 10 inch neck.”
Donald Trump President of the United States
(Speaking at a rally in Louisiana on 11/15/19)
“Right now, you have a kangaroo court headed by Little Shifty Schiff. We don’t have lawyers, we don’t have witnesses, we don’t have anything,” said the President. “It’s a scam, it’s a big scam.”
Donald Trump President of the United States
(Speaking at the White House on 11/20/19)
“Colloquially, I think you would call it extortion. But the U.S. criminal code defines both as bribery (here) AND extortion (in another section). To use a dated 70’s SNL reference: it’s a floor wax AND a dessert topping!”
Jonathan Zasloff Law Professor, UCLA School of Law (11/7/19)
Key Quotes from the July 25, 2019 Phone Call
“…the United States has been very very good to Ukraine. I wouldn’t say that it’s reciprocal necessarily because things are happening that are not good but the United States has been very very good to Ukraine.”
Donald J. Trump President of the United States (From transcript of 7/25/19 phone call between President Trump and Ukrainian President Zelensky)
“We. are ready to continue to cooperate for the next steps. Specifically we are almost ready to buy more Javelins [missiles] from the United· States for defense purposes.”
“I would like you to do us a favor, though, because our country has been through a lot and Ukraine knows a lot about it. I would like you to find out what happened with this whole situation with Ukraine, they say Crowdstrike.”
(From transcript of 7/25/19 phone call between President Trump and Ukrainian President Zelensky)
“There’s a lot of talk about Biden’s son, that Biden stopped the prosecution and a lot of people want to find out about that so whatever you can do with the Attorney General would be great. Biden went around bragging that he stopped the prosecution so if you can look into it… It sounds horrible to me.”
Donald J. Trump President of the United States
(From transcript of 7/25/19 phone call between President Trump and Ukrainian President Zelensky)
“I also wanted to thank you for your invitation to visit the United States, specifically Washington DC. On the other hand, I also want to ensure you that we will be very serious about the case and will work on the investigation.”
Volodomyr Zelensky President of Ukraine
(From transcript of 7/25/19 phone call between President Trump and Ukrainian President Zelensky)
NOTE: As of this writing, President Trump has not hosted President Zelensky at the White House. He finally met briefly with Zelensky on the sidelines of the UN General Assembly meeting in New York on September 25, 2019, the day after after House Speaker Nancy Pelosi announced the official opening of an impeachment inquiry over Trump’s pressure on Ukraine.
Key Quotes from the Impeachment Hearings
“By mid-July, it was becoming clear to me that the meeting President Zelensky wanted was conditioned on the investigations of Burisma, and alleged Ukrainian interference and the 2016 U.S. elections. It was also clear that this condition was driven by the irregular policy channel I had come to understand was guided by Mr. Giuliani.”
William Taylor Acting U.S. Ambassador to Ukraine (11/13/19)
“Needless to say, the Ukrainians in the meetings were confused. Ambassador Bolton and the regular Ukraine policy decision making channel wanted to talk about security, energy, and reform. Ambassador Sondland, a participate in the irregular channel, wanted to talk about the connection between a White House meeting and Ukrainian investigations.”
William Taylor Acting U.S. Ambassador to Ukraine (11/13/19)
“Very concerned, on that same day, September 1st, I sent Ambassador Sondland a text message asking if we are now saying that the security assistance and a White House meeting are conditioned on investigations. Ambassador Sondland responded asking me to call him, which I did. During that phone call Ambassador Sondland told me that President Trump had told him that he wants President Zelensky to state publicly that Ukraine will investigate Burisma and alleged Ukrainian interference in the 2016 election.”
William Taylor Acting U.S. Ambassador to Ukraine (11/13/19)
“In mid-August, it became clear to me that Giuliani’s efforts to gin up politically-motivated investigations were now infecting US engagement with Ukraine, leveraging President Zelensky’s desire for a White House meeting.”
George Kent Deputy Assistant U.S. Secretary of State for Eastern Europe and the Caucuses (11/13/19)
“On July 25, 2019 the call occurred. I listened in on the call in the situation room with White House colleagues. I was concerned by the call. What I heard was inappropriate and I reported my concerns to Mr. Eisenberg. It is improper for the President of the United States to demand a foreign government investigate a US citizen and a political opponent.”
U.S. Lt. Col. Alexander Vindman National Security Counsel Ukraine Expert, Director for European Affairs (11/19/19)
“At the September 1st meeting, which I attended, President Zelensky asked the Vice President about news articles reporting a hold on U.S. security assistance for Ukraine. The Vice President responded that Ukraine had the United States’ unwavering support and promised to relay their conversation to President Trump that night.“
Jennifer Williams Official at the State Department detailed to Vice President Mike Pence (11/19/19)
“As a professional diplomat, I was comfortable exploring whether there was a statement Ukraine could make about its own intentions to investigate possible corruption that would be helpful in convincing Mr. Giuliani to convey to President Trump a more positive assessment of the new leadership in Ukraine. On August 16th, Mr. Yermak shared a draft with me, which I thought looked perfectly reasonable. It did not mention Burisma or 2016 elections but was generic. Ambassador Sondland and I had a further conversation with Mr. Giuliani, who said in his view, in order to be convincing that this government represented real change in Ukraine, the statement [from Zelensky about conducting investigations] should include specific reference to Burisma and 2016.”
Kurt Volker Former US Special Envoy to Ukraine (11/19/19)
“Was there a ‘quid pro quo?’ As I testified previously, with regard to the requested White House call and White House meeting, the answer is yes.”
Gordon Sondland U.S. Ambassador to the European Union (11/20/19)
“Mr. Giuliani conveyed to Secretary Perry, Ambassador Volker, and others that President Trump wanted a public statement from President Zelensky committing to investigations of Burisma and the 2016 election … We all understood that these prerequisites for the White House call and White House meeting reflected President Trump’s desires and requirements.”
Gordon Sondland U.S. Ambassador to the European Union (11/20/19)
“I later came to believe that the resumption of security aid would not occur until there was a public statement from Ukraine committing to the investigations of the 2016 election and Burisma, as Mr. Giuliani had demanded.”
Gordon Sondland U.S. Ambassador to the European Union (11/20/19)
“Mr. Giuliani’s requests were a quid pro quo for arranging a White House visit for President Zelenskiy. Mr. Giuliani demanded that Ukraine make a public statement announcing investigations of the 2016 election/DNC server and Burisma. Mr. Giuliani was expressing the desires of the President of the United States, and we knew that these investigations were important to the President.”
Gordon Sondland U.S. Ambassador to the European Union (11/20/19)
“Remember, I left on July 19th, and the call took place the following week. In the months leading up to that, from May onwards, it became very clear that the White House meeting itself was being predicated on other issues, namely investigations and the questions about the election interference in 2016.”
Fiona Hill Former White House Adviser, Former Senior Director for European and Russian Affairs (11/21/19)
“It was quite loud when the President came on, quite distinctive. I believe Ambassador Sondland also said yesterday he often speaks very loudly over the phone. And I certainly experienced that. He — when the President came on, he sort of winced and held the phone away from his ear like this. And he did that for the first couple exchanges. I don’t know if he then turned the volume down, if he got used to it, if the President moderated his volume — I don’t know. But that’s how I was able to hear it.”
David Holmes Counselor for Political Affairs at the US Embassy in Ukraine
“It is important to understand that a White House visit was critical to President Zelenskiy. President Zelenskiy needed to show U.S. support at the highest levels in order to demonstrate to Russian President Putin that he had U.S. backing, as well as to advance his ambitious anti-corruption reforms at home.”
David Holmes Counselor for Political Affairs at the US Embassy in Ukraine
“My clear impression was that the security assistance hold was likely intended by the president either as an expression of dissatisfaction with the Ukrainians who had not yet agreed to the Burisma/Biden investigation or as an effort to increase the pressure on them to do so.”
David Holmes Counselor for Political Affairs at the US Embassy in Ukraine
“Ambassador Sondland placed a call on his mobile phone, and I heard him announce himself several times along the lines of Gordon Sondland holding for the President. It appeared that he was being transferred through several layers of switchboards and assistance, and I then noticed Ambassador Sondland’s demeanor changed and understood that he had been connected to President Trump. While Ambassador Sondland’s phone was not on speaker phone, I could hear the president’s voice through the ear piece of the phone.
“The President’s voice was loud and recognizable, and Ambassador Sondland held the phone away from his ear for a period of time, presumably because of the loud volume. I heard Ambassador Sondland greet the President and explained he was calling from Kiev. I heard President Trump then clarify that Ambassador Sondland was in Ukraine. Ambassador Sondland replied, yes, he was in Ukraine and went on to state that President Zelensky ‘loves your ass.’ I then heard President Trump ask, ‘So he’s going to do the investigation?’
“Ambassador Sondland replied that, ‘He’s going to do it,’ adding that ‘President Zelensky will do anything you ask him to do.’ Even though I did not take notes of these statements, I have a clear recollection that these statements were made.”
David Holmes Counselor for Political Affairs at the US Embassy in Ukraine
“I come back, I refer to the call, and everyone is nodding: of course that’s what’s going on. Of course the President is pressing for a Biden investigation before he’ll do these things the Ukrainians want. There is nodding agreement. So, did I go through every single word in the call? No, because everyone by that point agreed. It was obvious what the President was pressing for.”
David Holmes Counselor for Political Affairs at the US Embassy in Ukraine
Disclaimer: This is an in-depth look at the Fusion GPS Trump-research-related parts of Glenn Simpson’s testimony before the Senate Judiciary Committee on August 17, 2017 and before the House Intelligence Committee on November 14, 2017. The information below was presented by Glenn Simpson in his testimony, and is not being represented here as either fact or as the opinion of the webmaster unless specifically stated. All statements and assertions should be read as if prefaced by “Glenn Simpson states that …” Any content that I add will be surrounded by [brackets] and will likely include a link or reference to the source.
What is the narrative that Glenn Simpson told the Senate Judiciary Committee about his Trump research?
Glenn Simpson’s research firm, Fusion GPS, was hired by a Republican client to investigate Donald Trump as part of an opposition research campaign. After Trump won the primary, Fusion continued doing the research for a Democratic client. Simpson declined to disclose whether either client paid him directly for the work or if he was paid through an intermediary. [The Committee and Simpson’s attorneys had apparently agreed in advance that certain topics – names of his clients, communications with his clients, and naming sources of information – would not be pursued in any questions.]
Fusion’s research into Trump began in September or October of 2015 with a general exploration of public records regarding Trump’s businesses, associates, finances, bankruptcies, and “offshore or third world suppliers of products that he was selling.” The research “evolved somewhat quickly into issues of his relationships with organized crime figures,” including connections to Italian organized crime and a relationship with Russian organized crime figure Felix Sater.
Some of Trump’s money seemed to be coming from Kazakhstan and other unusual places, and the money couldn’t be accounted for. Trump also seemed to take a lot of business trips to Russia, but little if anything seemed to come from them, which Simpson found odd.
After the Prevezon case ended, Fusion hired Edward Baumgartner – who had worked on the Prevezon case and spoke Russian – as a subcontractor to do work such as researching Russian language newspapers for information about Paul Manafort and his work in Ukraine for now-exiled pro-Russian Ukrainian President Yanukovych. There were no other subcontractors who worked on both the Trump and Prevezon projects.
In May or June of 2016, once Trump was clearly the Republican nominee, Fusion’s Trump research ended for the Republican client and then resumed for a Democratic client. By that time, the research that could be done via public records had largely been exhausted, and a handful of areas of interest had also emerged, one of which was Trump’s business dealings in Russia.
Fusion hired former British intelligence officer Christopher Steele as a subcontractor to do “human intelligence” (interviewing people), a skill that is generally outside of Fusion’s data-and-document-driven strengths. Steele was hired specifically to obtain more in-depth information than could be determined from public records regarding Trump’s activities in Russia and other former Soviet countries, where Trump appeared to have relationships with Russian organized crime figures and other “colorful characters.”
Steele was the former “lead Russianist” with MI6 (Britain’s equivalent of the CIA), was a highly regarded investigator and an expert at identifying Russian disinformation. Simpson and Steele had worked together on other projects since 2009. Steele was known as “a person who delivered quality work in very appropriate ways … he’s basically a Boy Scout.” He “has a sterling reputation as a person who doesn’t exaggerate, doesn’t make things up, doesn’t sell baloney …. Everyone I know who’s ever dealt with him thinks he’s quite good. That would include people from the U.S. government.” Asked if credibility with the FBI was one reason for Fusion hiring Steele, Simpson said no. Consistent with Fusion practices to ensure integrity of gathered information, Christopher Steele and Ed Baumgartner were unaware that each other was working on the case.
Between June-October 2016, Steele created 16 memos that he sent to Simpson, as well as a 17th memo in December 2016, after the election. Steele told Simpson that he did not believe that what he had reported in the memos was disinformation.
The 17th memo was created after Steele’s engagement with Fusion GPS had ended, because Steele’s sources were still continuing to provide him with information. It is unclear whether that 17th memo was sent to Simpson or to someone else. Steele’s attorneys had apparently stated in the past that this 17th memo had been given to a “senior United Kingdom government national security official” although Simpson expressed ignorance of this.
Whenever Steele sent in a memo, Simpson would generally verify it against information that Fusion had already gathered through other sources such as public documents, and Steele’s information matched up. Neither Simpson nor Fusion edited or altered Steele’s memos in any way. Steele did not name the human sources of his information for the memos, and Simpson does not believe that he paid them for information.
Simpson had expected that Steele’s memos might reveal evidence of corruption in Trump’s overseas dealings. Instead, Steele’s first memo raised alarms that the Russian government had been “cultivating and supporting” Trump for at least 5 years, that Trump and his inner circle had been accepting a “regular flow of intelligence from the Kremlin, including on his democratic and other political rivals,” and that Trump was also sufficiently compromised by the FSB (under direction of Putin) that he could be blackmailed, particularly with regards to a potentially videotaped sexual act in the Presidential Suite of the Moscow Ritz Carlton Hotel.
Russian intelligence is known to have recording devices in many Russian luxury hotel rooms to gather “kompromat” – compromising material – on political and business leaders. [This practice dates back to the Soviet Union and KGB, and is believed to have been used by Putin for political advancement early in his career] [New York Times]. Such a situation poses a profound danger to the national security of the United States if a U.S. President or other major U.S. political figure can be blackmailed by a hostile foreign power.
Steele’s first memo also noted that the Kremlin had compiled a dossier of years of recorded phone conversations and other records of Hillary Clinton, mainly revealing her expressing opinions that differed from her public positions.
Simpson was aware of the Kremlin’s hostility toward Hillary Clinton and of Russia’s interference in recent European elections, and was also aware of the possibility of meddling in a U.S. election by a foreign government. While an investigative reporter at the Wall Street Journal, Simpson had exposed a Chinese effort to swing the 1996 Presidential election to Bill Clinton.
Additionally, Simpson recalled a story that he had written as a WSJ journalist about Oleg Daripaska (Russian oligarch suspected to have ties to organized crime) meeting with John McCain (R-AZ) before the 2008 election. And as a journalist, Simpson had written stories about Paul Manafort’s connections to the (pro-Putin) Party of Regions in Ukraine, to pro-Putin ousted Ukrainian President Viktor Yanukovych, and to Russian oligarchs suspected of corruption. The Manafort stories had sprung from earlier stories that Simpson had written about the Kremlin collaborating with the Russian mafia to skim money from the gas trade between Ukraine and Russia. All of these things came to mind for Simpson as he pondered Steele’s first memo.
Steele believed the information in this memo to be potentially evidence of a crime in progress and a matter of national security concern to the United States. He considered it his professional obligation to report it to U.S. authorities, and expressed this to Simpson. Simpson was hesitant at first, but eventually said that Steele should report it if he felt that it was his obligation. Steele reached out to a contact that he had at the FBI. Simpson’s perspective was “to me this was like, you know, you’re driving to work and you see something happen and you call 911.” Simpson did not seek anyone else’s approval [one would assume that “anyone else” would include Fusion’s Democratic client] to authorize Steele to go to the FBI.
Simpson did not know if Steele gave the FBI the actual written memo, and did not know if Steele had actually requested that the FBI open an investigation. Simpson only later learned from news reports that Steele first contacted the FBI in the first week of July [a few days after Simpson had agreed that he should do so]. Simpson wondered for months if the FBI had actually done anything with the information: he knew that the Department of Justice has rules against law enforcement getting involved in the middle of a campaign, but he also increasingly believed that a serious crime was in progress regarding the hacking of the DNC and others.
In mid to late September, the FBI contacted Steele and said that they wanted all of the information that he had, so Steele met with them in Rome (at FBI expense) and debriefed them. Simpson testified that the FBI told Steele that they “had other intelligence about this matter from an internal Trump Campaign source” independent of Steele’s sources, and that they believed that Steele’s information was credible. Later in the testimony, Simpson said that it was unclear if the FBI was the one who told Steele about this, and that he was also unclear if the FBI’s other source was someone in the Trump Campaign or the Trump Organization.
Simpson was nonetheless uncertain and deeply concerned about how seriously the FBI was in investigating Steele’s findings. This concern came to a head when the New York Times ran a story on October 31, 2016 stating that the FBI had been investigating Trump-Russia connections and had found nothing. [New York Times] Shortly after that, Steele cut off his relationship with the FBI, believing that the FBI was possibly somehow being influenced by the Trump Campaign for political purposes. After the election, the FBI contacted Steele about possibly being paid by them to continue his investigative work, but he declined.
Republicans on the Senate Judiciary Committee had a back and forth with Simpson and his attorneys regarding whether the non-disclosure agreement between Fusion and Orbis (the company that Steele worked for) forbade Simpson and/or Steele from giving the memos and/or the information in them to the press or to law enforcement. Republicans also pointed out that in a lawsuit against Steele, Steele’s attorneys had stated that Steele and Fusion, at Fusion’s instruction, had given “off-the-record briefings” in September and October 2016 to journalists from the New York Times, the Washington Post, Yahoo News, the New Yorker, ABC, and others.
Simpson was asked if he or Fusion has provided Steele’s actual memos to their Democratic client or to Buzzfeed, the news outlet that first publicly released them. Simpson’s attorney told Simpson not to answer that question verbally, but the attorney had apparently provided a written statement to the Judiciary Committee stating that they had not provided the actual memos to those entities.
Senate Judiciary Committee Republicans asked a number of questions implying that Fusion’s Trump investigation was unethical, and Simpson responded:
No, the amount of Fusion’s pay or Orbis’s pay was not contingent on whether or not the FBI started an investigation.
No, to Simpson’s knowledge, Christopher Steele and Rinat Akhmetshin (HRAGI lobbyist employed by Natalia Veselnitskaya and who was at the Trump Tower meeting) did not know each other, and Akhmetshin did not work for Orbis.
No, Simpson does not believe that he discussed the existence of Fusion’s Trump investigation with Natalia Veselnitskaya, Rinat Akhmetshin, or anyone involved in the Prevezon case including anyone at Baker Hostetler, and does not believe that Steele did so either. Doing so would have been a violation of their non-disclosure agreements.
No, Simpson was not influenced in his actions on the Trump project by Veselnitskaya or Akhmetshin, and does not believe Steele to have been either.
After the election, Sir Andrew Wood, Britain’s former ambassador to Russia, had a chance encounter with U.S. Senator John McCain and his adviser, David Kramer, at a security conference in Nova Scotia, and informed them of the dossier. Rinat Akhmetshin was listed in conference records as being in attendance at that conference, a fact of which Simpson was unaware until the Senate hearing.
It is unclear how Wood had learned of the dossier: nobody at Fusion had provided any information about it to any foreign governments. After the conference, Kramer reached out to Steele to get more information for McCain to bring to the FBI’s attention. At this point, Simpson and Steele were still unclear how seriously the FBI was taking the information or if the information had been conveyed to anyone of high rank in the FBI, so the idea of having a U.S. Senator take the information to the FBI was appealing.
Some miscellaneous information from Simpson’s testimony included:
Simpson researched Trump foreign policy adviser Carter Page, as well as Russian government officials Sergei Ivanov and Igor Sechin. Simpson believed Carter Page to be potentially compromised by the Kremlin.
Simpson observed that most Russians work to some degree for the Russian government and receive pensions. Simpson speculated that if those Russians were to move to the U.S., the Russian government disbursing their pensions would be an ideal way for the Russian government to launder money and get money out of Russia – a concept suggested in Steele memos #4 (2016/095) and #10 (2016/111). Simpson encouraged the House Judiciary Committee to look further into this, because there is a large amount of Russian money coming into the U.S. through what Simpson believes are fake or inflated pensions. However, such payments might not be easily traceable and would fall under diplomatic privileges.
Simpson explained that “Russian organized crime is …. involved in politics and banking and there’s even a lot of connections between the mafia and the KGB or FSB and cyber crime …. Stock fraud in particular was the big thing in the U.S.”
Simpson learned of a New York court case in which the government of Kazakhstan was trying to recover billions of dollars that had allegedly been stolen during the failure of a major bank called BTA Bank. The money was allegedly laundered in Europe and the United States. Felix Sater, a real estate developer who at one time had an office in Trump Tower, appeared to be involved in some way, and there were media reports that some of the money went into Sater’s company in the building of Trump Soho.
Simpson’s review of estate taxes on Trump’s properties indicated that Trump publicly estimated his individual properties to be worth far more than he says that they are worth on his taxes, and a number of his golf courses don’t make any money.
Toward the end of testimony, Simpson was asked about Alfa Bank and its founders, Pyotr Aven, Mikhail Fridman and German Khan. Simpson had little information about them.
Prompted by his attorney, who cited the terms agreed upon by the Senate Committee prior to the testimony, Simpson did not answer a small handful of questions, mainly pertaining to names of his clients, communications with his clients, and naming sources of information. In general, he appeared to be extremely forthcoming in his 10-hour testimony.
What did Glenn Simpson tell the House Intelligence Committee about Fusion’s Trump research that he did not already say in his Senate testimony?
The Republican client who initially engaged Fusion to research Presidential candidate Donald Trump was a conservative web publication called the Washington Free Beacon. [The Beacon’s benefactor, Paul Singer, was a supporter of (then-Presidential hopeful) U.S. Senator Marco Rubio (R-FL)]. [New York Times] Simpson did not believe that the Beacon was acting as a proxy for any specific candidate, but believed that they were generally from the wing of the Republican Party that was concerned about a takeover of the GOP by Trump and his supporters. Simpson also researched (then-Presidential hopeful) U.S. Senator Ted Cruz (R-TX) for the Beacon during the 2016 Republican Primary.
The Beacon would sometimes ask Fusion to pass researched information on to reporters. Other times, reporters would reach out to Fusion for information, and Fusion would make sure that the Beacon authorized sharing the information with that reporter. The Beacon also provided some of Fusion’s research to reporters without necessarily notifying Fusion.
During the period when the (conservative) Beacon was Fusion’s client, the issues that surfaced about Trump with regard to Russia that raised enough questions in Simpson’s mind to warrant further exploration included:
Trump’s relationship with Felix Sater and Sater’s real estate development company Bayrock – a company that Simpson believed had ties to Russian organized crime and received “opaque” funding from Russia and other former Soviet countries. Alexander Mashkevich, a financial backer of Bayrock, is a Central Asian organized crime figure who has been involved in money laundering, the mining industry, and Kazakhstan.
The Trump campaign’s hiring of Paul Manafort, who Simpson knew had worked for Ukraine’s pro-Russia political party, and who had also successfully worked to get pro-Russian candidate Viktor Yanukovych (now exiled in Russia) elected President of Ukraine.
The “amazing number of people from the former Soviet Union who had purchased properties from Mr. Trump.” [One of them was Dmitry Rybolovlev. Rybolovlev was a wealthy Russian oligarch who purchased a Palm Beach mansion from Trump for a staggering $95 million in 2008. Trump had paid around $41 million for it just two years earlier and had made very few improvements to it, raising questions about why Ryoboloviev had paid so much for it. The current U.S. Secretary of Commerce, Wilbur Ross (former Vice Chair of the Bank of Cyprus) connected Rybolovlev and Trump to do the transaction.] [MSNBC]
The number of Trump properties where it was not easy to determine who the buyer was.
Various criminals buying Trump properties, including one who was running a high stakes gambling ring out of Trump Tower.
The number of Trump properties that were sold at a loss shortly after they were bought.
“Patterns of buying and selling that we thought were suggestive of money laundering”
The number of trips that Trump had taken to Russia.
All of these activities started surfacing in a period in Trump’s career beginning in about 2005. Recent Trump projects that also raised questions for Simpson included a Trump development in Panama, one in Toronto, and Trump’s golf courses in Scotland and Ireland, which seemed to have a lot of opaque money coming into them and were not making any money.
The numerous Russia connections got Simpson wondering about possible connections between Trump and the Russian mafia. Simpson had learned as an investigative reporter at the Wall Street Journal that the Russian mafia is more sophisticated and more global in their activities than the Italian mafia – “[the Russian mafia] understand finance a lot better” – and they often create very elaborate money laundering schemes, including fake court arbitrations, commodities deals, and “securities straits” [this was probably incorrectly transcribed during testimony and was supposed to be “securities trades”] in order to make the source of the money harder to trace: “if you can think of a way to launder money, the Russians are pretty good at it.”
The Russian mafia is also involved in legitimate American businesses and the American government. Simpson had actually left the Wall Street Journal in 2009 in part because he wanted to investigate Russian involvement in Washington DC, but the Journal had lost interest in the topic. In talking to his sources at the time, Simpson found that “everyone said the Russians are back, and they are buying influence in Washington left and right, and they are trying to bribe all these Congressmen.”
The Russian mafia is “essentially under the dominion of the Russian Government and Russian Intelligence Services. And many of the oligarchs are also mafia figures.”
Putin’s rise to power basically included gaining control over the oligarchs and the Russia mafia [this account by Simpson is consistent with William Browder’s description of Putin’s rise to power, and corroborates why Putin might have initially been supportive of Browder’s efforts to expose how oligarchs were ripping off shareholders]. Everyone in Russia essentially works for Putin, and U.S. law enforcement believes this to be true of Russian mafia figures in the United States as well.
Because of this connection between organized crime and the Kremlin, if Trump’s businesses were taking in large amounts of illicit money from Russian mafia figures, the Kremlin would certainly know about it. “If people who seem to be associated with the Russian mafia are buying Trump properties or arranging for other people to buy Trump properties, it does raise a question about whether they’re doing it on behalf of the Russian government.” Knowledge by the Kremlin of such dealings by Trump or his businesses could also be used as “kompromat,” potentially giving the Kremlin leverage over Trump, particularly once Trump began running for President, and even more so once he became President.
After the Republican Primary ended and Trump was the Republican candidate, Fusion was hired by Seattle-based international law firm Perkins Cole – whose clients include the DNC – to continue researching Donald Trump. Peter Fritsch, Simpson’s business partner at Fusion, originally spoke with Perkins Cole about doing Trump research for them. Simpson was unaware if Fritsch approached Perkins about the project or vice-versa. Simpson understood his client to be Perkins Cole, and also understood that the DNC was Perkins Cole’s client in the opposition research that Fusion was doing into Trump.
By the time Perkins Cole hired Fusion, Fusion had already explored a wealth of documents and public records on Trump, and was now at a point to “develop more specific lines of inquiry.” Because Fusion was already familiar with the information gathered thus far, Fusion decided which areas were worthy of deeper investigation: “we were the architects of the research.” Simpson asserts that having Fusion determine what to research generally ensures that a client’s preconceived ideas don’t get in the way of producing an accurate picture.
Fusion’s lines of inquiry included Trump’s overseas business dealings, labor practices in his overseas factories, his tax disputes, his bankruptcies, and who some of his business partners were. Simpson stated that “We never set out to investigate whether Donald Trump or anyone else was engaged in sexual activity for the sort of practical reason that I just didn’t think it was a useful subject to investigate. I investigate business stuff and financial crime and corruption and those kind of things. That’s my gig. So people came to us with stories that we never pursued.”
Regarding Simpson’s relationship with Christopher Steele, Simpson originally met Steele while living in Brussels, Belgium – a location that facilitated Simpson’s reporting on one of his biggest areas of interest, organized crime and corruption in the former Soviet Union. This interest had continued after Simpson left the Wall Street Journal in 2009. By then, Simpson’s Russia/ex-Soviet focus had become a rather obscure topic in an age where most U.S. media attention abroad focused on al-Qaeida and the Middle East. A mutual friend, who knew that Steele shared this interest in Russia, introduced Simpson to Steele.
Steele was paid by Fusion for his work on the Trump project. Fusion billed Perkins Cole for Steele’s time as one of the expenses of Fusion’s work (in other words, as an outside consultant, not as a full-time Fusion employee).
Christopher Steele can speak Russian, and told Simpson that when he gathers information, he is aware that he is being given some misinformation, and does his best to filter that out before passing it on to his client (in this case, Fusion).
Simpson believes that Steele did not personally go to Russia to do his research for the Trump project. Steele had not billed Fusion for any trips to Russia, and it would also be dangerous for Steele to go there, because he had been previously exposed as a former member of British intelligence who had worked in Moscow. So instead, Simpson believes that Steele hired paid subcontractors in or from Russia who could travel around and ask questions without raising suspicion. The people that those subcontractors spoke to (in bars, etc.) were not paid for information, and were likely not told that they were being asked questions as part of a paid project.
Simpson did not know who Steele’s subcontractors were, and Simpson did not thoroughly verify their information. He trusted Steele’s expertise in filtering out disinformation and Steele’s reputation for obtaining quality information. Verification by Simpson consisted of checking Steele’s information against Simpson’s knowledge of events from public documents that Fusion had researched for the case. Simpson found nothing in Steele’s reports that was contradicted by publicly available information.
While Simpson normally edits and provides analysis of field memos from a subcontractor and incorporate it into an overall report, the information provided by Steele was so shocking and concerning that Simpson just left it raw: all of the memos are exactly what Steele sent him. The 17th Steele memo came in after the election, and Fusion was not paid for it.
Fusion’s client did not direct or authorize Simpson or Steele to go to the FBI: that was Steele’s decision, which Simpson had assented to.
Going to the FBI
Because Steele’s information, by its nature, could not be conclusively and definitively proven with official documents, Simpson was not certain at first whether Steele’s information rose to the level of certainty to take it to law enforcement, but after consideration, on July 1 or 2 Simpson consented to Steele taking his info to the FBI. Describing the situation in which he and Steele found themselves, Simpson said “We threw a line in the water and Moby Dick came back, and we didn’t know what to do with it at first.”
On July 4, Steele went to the FBI, and informed Simpson of this shortly thereafter. Steele told Simpson that the FBI thanked him and said that they would be in touch if they needed to follow up. Simpson believes that Steele likely mentioned to the FBI that he had uncovered the information in the course of work for Fusion GPS on behalf of a Democratic client, but does not know for certain if that disclosure was made.
The FBI contacted Steele before the election, but did not contact Fusion before the election.
After FBI Director Janes Comey’s October 29, 2016 announcement that the FBI was reopening the investigation into Hillary Clinton, and the October 31, 2016 New York Times story that the FBI had found no ties between Trump and Russia, Steele and Simpson “were, frankly, you know, very scared for the country and for ourselves and felt that if we could give it to someone else, we should, higher up.”
After the election, Steele told a friend – a U.S. Prosecutor named Bruce Ohr – about what he had uncovered during his work for Fusion, and suggested that Ohr contact Simpson. Around Thanksgiving, Ohr did contact Fusion to get information for the Department of Justice. [According to Fox News, Ohr’s wife Nellie Ohr worked for Fusion on Trump-related issues during the summer of 2016.] [Fox News]
Concerned that the FBI was possibly being unduly influenced behind the scenes and that Russia, a hostile foreign power, was in the process of swaying the election, Steele and Simpson also decided to go to the major media again with their Trump-Russia info.
The Meeting With Journalists
The journalists that Simpson and Steele had met with in September 2016 were generally national security reporters, not political reporters, because Simpson and Steele were concerned that they had stumbled on a national security issue. At the time, Simpson assumed that Clinton was going to win the election, so there was “no urgency to it” – he just wanted reporters to start looking into it because it was concerning. He was aware that the reporters would likely not be doing a story on it before the election, because “when you get past Labor Day, people stop publishing stories that could be perceived as a late hit or an October surprise.”
And in fact there was little coverage of it.
Simpson believes that Perkins Cole would generally have known that his conversations with reporters in the summer of 2016 were informed by the Steele dossier, but he would not have needed to clear every such conversation with Perkins Cole.
Regarding Buzzfeed getting the Steele dossier, Simpson said (under oath) “Well, to just put it on the record, we were not the ones that gave this document to Buzzfeed, and I was not happy when this was published. I was very upset. I thought it was a very dangerous thing and that someone had violated my confidences.” Simpson said that he had his suspicions about who might have passed the dossier to Buzzfeed, but would not share that speculation in his testimony.
Republicans asked Simpson if he believed that, based on the evidence that he and Steele had gathered, Simpson “could conclusively say as fact that the Russian Government and the Trump Campaign were colluding with each other to beat Hillary Clinton.” Simpson said no, and that even with information publicly known now, such an assertion cannot be made, but since the election, there has been a clear pattern of secretive contacts and other odd behavior that “supports the broad allegation of some sort of an undisclosed political or financial relationship between the Trump Organization and people in Russia.”
Trump’s Russian Connections
In Simpson’s deeper research of Trump associates, he found more key Russian connections, including:
A Trump-linked Russian linguist named Sergei Millian (aka Siarhei Kukuts – his name before moving to Atlanta). Millian ran the Russian-American Chamber of Commerce (Russians have used such groups as intelligence operations), and claimed to have worked for the Russian Foreign Ministry in the past. He boasted of being an exclusive agent for Trump in Russia, and claimed to have sold hundreds of million of dollars in Trump properties to Russians. He was also connected with Russotrudnichestvo, believed by the FBI to be a front for the Russia’s foreign intelligence agency SVR. Millian was also linked to Trump’s lawyer, Michael Cohen, who appeared to have a lot of connections in the former Soviet Union and to Russian organized crime figures in New York and Florida.
Around 2003/2004, Trump was having trouble getting bank loans for buying or developing property, but was able to get credit if he could show that he had already pre-sold a certain percentage of units. Russians were willing to vouch for those pre-sales. For a project in Panama, a number of Russian gangsters agreed in advance to purchase condos there, which enabled Trump to get a bond from Bear Stearns. In addition to getting funding, the goal of such “pre-sales” was to hook in additional legitimate condo buyers who would believe that the project already had a lot of committed interest from other buyers. In Panama, the alleged Russian buyers signed paperwork, but never paid. Simpson believes that the project was built, but went “belly up.” A similar arrangement with pre-sales to Russians took place with Trump’s Toronto project.
The Agalarovs (who organized the Trump Tower meeting) appeared to be associated with people involved in major money laundering activity in New York in the 1990s. The Agalarovs had come to the United States from Russia around the fall of the Soviet Union, during which period, many powerful Russians came to the United States to launder money.
Based on what Simpson knows about the Agalarovs and Russian intelligence, he now believes that it is reasonable to assume that the Trump Tower meeting, organized by Aras Agalarov, was part of a Russian intelligence operation.
The Kushners are ethnic Russian and have a number of connections with Russians who immigrated to New York in the 1970s during the Refusenik era.
Howard Lorber, a real estate investor who did a lot of deals in Russia when things were fairly “wild” after the fall of the Soviet Union, is someone who Trump considers a good friend. Lorber and Bennett LeBow “introduced Trump to Russia.”
Trump had been to Russia a minimum of 4-5 times since the late Soviet years. Simpson found it odd that Trump made a number of “opaque” trips to Russia without coming back with a deal. Simpson initially thought that perhaps Trump’s lawyers were preventing him from going through with any deals out of concern that he would be violating the Foreign Corrupt Practices Act (FCPA), which makes it unlawful for U.S. citizens to bribe foreign government officials to get business. Simpson later concluded that money was actually coming out of Russia and being invested in Trump’s properties in the U.S. and elsewhere.
Simpson believed that Felix Sater, a friend of Trump, had connections to Russian organized crime. Simpson also believed that Sater’s company, Bayrock – which developed the Trump Soho Hotel – was involved in “illicit financial business activity and had organized crime connections.” Simpson had also noticed a general shift from Trump being associated with Italian mafia figures early in his career to Russian mafia figures starting in the 1990s. Notably, despite Sater’s involvement with developing Trump Soho and having an office in Trump Tower, Donald Trump has said that he is not sure that he would recognize Sater if he saw him.
Trump Jr. had gone to Russia a number of times, and had also gone to Kazakhstan for reasons that could not be determined. He had also gone to Latvia.
Regarding Dmitry Rybolovlev, the Russian oligarch who had inexplicably bought a run-down Palm Beach mansion from Trump for over twice what Trump had paid for it just two years earlier, Simpson had initially believed that that transaction was part of an overall pattern of excessive spending by Rybolovlev in order to prevent his ex-wife from accessing his money. However, Simpson later learned that Rybolovlev was closely connected to Igor Sechin, described by Simpson as “Putin’s No. 1 compadre in the kleptocracy.” Sechin apparently helped Rybolovlev leave Russia with billions of dollars.
Simpson’s conclusions about Trump possibly being involved in organized crime resulted from a large amount of factual evidence that was suggestive of an organized crime connection. However, due to Simpson’s lack of legal authority to subpoena people, etc., his conclusions not completely provable through documents and data.
Simpson’s Suggestions for Further Investigation
Simpson was asked for his thoughts on areas that the House Intelligence Committee should explore further. His response included:
Records (potentially subpoenaed if necessary) from banks, real estate agents, and title companies. Simpson had not gone after bank records because doing so would be illegal due to financial privacy laws, and because he did not have governmental subpoena power. Such records could help determine if Trump properties had been used for money laundering, which Russia could be using to blackmail the President.
Of particular interest would be Deutsche Bank’s records related to the characters involved. [Deutsche Bank had been one of the only financial institutions willing to loan money to Trump after he filed for bankruptcy.] [Business Insider]
The possibility of an “unacknowledged relationship between the Trump people and the UKIP people and that the path to WikiLeaks ran through that.”
Russian intelligence defectors living in the United States: ask what they think is going on.
The travel records of people in Trump’s circle.
The “Manafort-Stone-Trump relationship.” Roger Stone and Manafort worked in Ukraine for some “bad guys” with Arthur Finkelstein around 2005-2006. Finkelstein went on to work for pro-Putin Prime Minister of Hungary, Victor Orban.
Irakle Kaveladze, a Russian who was at the Trump Tower meeting. Simpson believes that Kaveladze and the Agalarovs have been involved in money laundering since the 1990s, and have laundered KGB money.
A couple weeks in August 2016 when Trump lawyer Michael Cohen, Ivanka Trump, Jared Kushner, and Donald Trump were in the Hamptons. Dmitry Rybolovlev’s plane was close by, and Ivanka and Jared disappeared for a few days. Rybolovlev’s plane landed in Dubrovnik (Croatia), on August 12, and Jared and Ivanka reappeared in Dubrovnik. “There had been rumors of meetings between Trump people and Russians on yachts off Dubrovnik.”
The relationship between Jared/Ivanka and Roman Abramovich, a Russian billionaire.
A female attorney in Florida [whose name Simpson could not recall during testimony] who used to work for Gazprom, had ties to Michael Cohen, and played some role in distributing Russian pension payments.
The oligarchs associated with the school in Russia where Carter Page spoke in July 7, 2016. Simpson believed that a Russian intelligence agent named Evgeny Buryakov had tried to recruit Carter Page, and that Page had been a long-time target of Russian intelligence.
Alex Shnaider, a Russian-born Canadian national who was a partner of Trump in developing Trump International Hotel and Tower in Toronto. Simpson says that Shnaider’s father-in-law, Boris Birshtein, was important in the history of the alliance between the KGB and the Russian mafia, and managed the KGB’s offshore funds after the fall of the Soviet Union, mainly at Romania-based Raiffeisen Bank.
The Intersection of Prevezon and Trump
Questions inevitably were asked of Simpson about his having worked with Natalia Veselnitskaya, the Russian lawyer who met with Trump Jr., Paul Manafort and Jared Kushner at Trump Tower.
Simpson never shared any of Christopher Steele’s info with Natalia Veselnitskaya or even with most of his own staff at Fusion. None of the info that Fusion used in its Trump research came from Veselnitskaya.
“I would certainly agree with the observation that for these matters to have intersected in the way that they did is, you know, remarkable. And it caught me totally by surprise, and I have spent a lot of time thinking about what it means, if it means anything.”
Simpson found that Trump estimated his property values very low for tax purposes. However, Simpson believed that Trump was not low-balling to save money, but was in fact giving an accurate record of those property values.
Simpson believed that Nigel Farange went to the Ecuadorian Embassy more than the one time reported in the press and provided data to Julian Assange on a thumb drive.
In one of Steele’s reports, Simpson learned that the Kremlin’s the U.S. Presidential election operation was run by Sergei Ivanov, a former KGB agent.
“Putin seems to be very interested in the Jewish diaspora,” ie, Jewish Russians who have emigrated to other countries.
“The Orthodox church is an arm of the Russian state now.” A lot of senior church officials are ex-KGB, and they use the church as a way to move money around.
Russia has been working on infiltrating “soft” conservative organizations, including the NRA. Alexander Torshin and Maria Butina were names that came up.
Nobody asked Simpson to research Hillary Clinton in 2015 or 2016, but she came up in the course of some of his investigative work. Simpson said that nothing in his research into the Clinton Foundation was relevant to the Russia investigation.
Simpson was asked if someone had been killed as a result of the information in the Steele dossier, and Simpson said that that was not the case. This contradicted a statement by Simpson’s attorney, Levy, during the Senate Judiciary testimony.
U.S. Rep. Adam Schiff (D-CA) mentioned that Republicans on the Committee are not letting Committee Dems in the loop on documents that are being requested from witnesses, etc.
Simpson was asked if he was currently being paid by anyone to continue the Trump research. He refused to answer.
Simpson’s testimony about Fusion’s Trump research provides a wealth of leads for journalists and law enforcement to pursue, and seems to make abundantly clear that Trump’s statement that “I have nothing to do with Russia” is false.
If Simpson’s research is accurate, it is well within the realm of possibility that Donald Trump was knowingly or unknowingly involved in money laundering during his real estate career, and in particular, money laundering for Russian oligarchs and Russian mafia figures. Because of the interconnectedness in Russia of the mafia, the oligarchs, and the Kremlin, it is likely that such activities would have come to the attention of Vladimir Putin, who would no doubt be eager to use such “kompromat” as blackmail fodder/leverage over the President of a country that Putin viewed as responsible for the fall of the Soviet Union. It follows that Putin would be supportive of such an individual’s 2016 Presidential candidacy, knowing that he could make use of such an individual in the Oval Office to sow discord and chaos, and to undermine the foundations of America’s institutions.
A particular highlight of Simpson’s testimony was the interactions with the FBI. Steele had brought the information from his first memo to the FBI in early July, 2016, after which there were apparently months that Simpson and Steele had no idea if the FBI had done anything with that information. In mid-late September, the FBI asked Steele for all of his Trump-related research, and Steele provided it, again, not knowing what, if anything, was going to be done with it. Then, less than two weeks before the election, FBI Director James Comey broke with precedent and policy to announce on October 28 that he was reopening the investigation into Hillary Clinton’s e-mails, and three days later, on October 31, Simpson and Steele read in the New York Times that the FBI had been investigating Trump for Russian connections but had found nothing – a conclusion that completely contradicted the information that Steele knew that he had given to the FBI.
At that point, one can imagine the fear and confusion that Simpson and Steele must have felt. They had provided the FBI with a large amount of credible information pointing to a huge, active operation by a hostile foreign power (with a history of deep government corruption, organized crime, and political assassinations) to support one U.S. Presidential candidate over the other. Yet bewilderingly, the FBI seemed to be publicly denying that any such operation was happening, and was instead taking unprecedented actions that would almost certainly undermine the campaign of the candidate that Russia hoped to defeat. At that moment, it certainly must have crossed the minds of Simpson and Steele that the FBI could possibly be somehow complicit in Russia’s operation or complicit with Trump’s Campaign. Realizing that the FBI knew the identities of the two men who could expose the operation – Simpson and Steele – must have resulted in an absolutely terrifying time for those two men.
Of course, the obvious questions concern the intersection of the Trump investigation and the Prevezon case. The fact that Fusion was doing paid work as part of opposition research campaign against Trump (with attention to Russia) at the same time that the Russian lawyer of Fusion’s client on another project met with Trump Campaign officials at Trump Tower to pass on research gathered by Fusion seems like an incredible coincidence. My gut tells me that it is exactly that – a coincidence – but it is certainly enough to reasonably warrant some of the “conspiracy theory” lines of questioning engaged in by House and Senate Republicans.
Another area that seems odd is the chance meeting between British citizen Sir Andrew Wood and U.S. Senator John McCain (R-AZ) after the election. According to a U.S. Representative questioning Simpson, Wood was an associate of Orbis, the company that Steele worked for. Wood bumped into McCain at a security conference in Nova Scotia and notified him of Fusion’s Trump investigation.
It seems reasonable to assume that Steele was the one who had informed Wood about the Trump research. Not knowing Wood’s role at Orbis, it may also have been reasonable for Wood to have been attending a security conference. However, the fact that Rinat Akhmetshin (Natalia Veselnitskaya‘s hired lobbyist who had been at the Trump Tower meeting) was on the roster of attendees at that same conference seems highly coincidental. Akhmetshin might have seen the event as a place to meet U.S. legislators and lobby them on behalf of HRAGI, but his surfacing at this particular event under these particular circumstances raises additional questions.
Despite these oddities, Simpson truly comes across as a credible and forthcoming witness, and it is difficult to be suspicious of him given how thoroughly and readily he responded to questions. At times, he seemed to be pushing back against his lawyers’ advice because he wanted to give even more information. It is also difficult to believe that the information that Fusion uncovered about Donald Trump does not point to an undisclosed history of potentially illegal or unethical activities between Trump and the Russians, knowledge of which would almost certainly have made its way back to the Kremlin for blackmail purposes.
– rob rünt
Read more of this special series:
The Trump-Russia Web
Disclaimer: This is an in-depth look at the Prevezon-related parts of Glenn Simpson’s testimony before the Senate Judiciary Committee on August 17, 2017 and before the House Intelligence Committee on November 14, 2017. The information below was presented by Glenn Simpson in his testimony, and is not being represented here as either fact or as the opinion of the webmaster unless specifically stated. All statements and assertions should be read as if prefaced by “Glenn Simpson states that …” Any content that I add will be surrounded by [brackets] and will likely include a link or reference to the source.
[In 2013], Veselnitskaya hired U.S. law firm Baker Hostetler to help defend Prevezon against charges by the U.S. Department of Justice that Prevezon had been engaged in money laundering in the United States. Baker Hostetler hired Glenn Simpson’s firm, Fusion GPS, for research to help support Prevezon’s case. Fusion’s involvement in the case was directed by Baker attorney/partner Mark Cymrot.
Baker Hostetler is a well-regarded conservative law firm. They have a legal obligation to research who their clients are to ensure that the firm is not accepting payments from a foreign government. Simpson therefore assumed that Baker had done the work to make that determination before Fusion was brought into the case.
Payment of Baker Hostetler in the case was made by Prevezon, and was directed by Veselnitskaya. Baker Hostetler in turn paid Fusion. There were no direct payments to Fusion by either Prevezon or Veselnitskaya. To assist in gathering Russian language documents and locating witnesses, Fusion hired Edward Baumgartner, a Russian-speaking consultant. Baumgartner would later work on the Trump investigation for Fusion after the Prevezon case ended.
According to Prevezon, the money laundering allegations against them originated from a high-level Russian organized crime figure, Demetri Baranovsky, who had been posing as an anti-corruption campaigner in Russia and blackmailing various Russian companies. Baranovsky had threatened to expose Prevezon for money laundering. Prevezon had notified the Russian authorities of the threat, and Baranovsky was prosecuted and jailed for blackmail.
Veselnitskaya had been Prevezon’s lawyer in that case and had detailed knowledge of it. Baranovsky’s money laundering allegations against Prevezon were brought to the attention of the U.S. Department of Justice by investment manager William Browder. Glenn Simpson had met Browder years earlier as a reporter at the Wall Street Journal. At that time, Browder had spoken highly of Putin, and insisted that Putin was not corrupt at all – an opinion which Browder had thoroughly reversed by the time that he had contacted the DOJ about Prevezon. The DOJ investigated Browder’s allegations against Prevezon, and took the issue to trial.
Through its research for Baker Hostetler, Fusion GPS determined that Baranovsky had in fact been jailed for blackmailing. When Fusion attempted to interview Browder about the allegations, Browder refused. Baker Hostetler tried to subpoena him, but Browder denied having any presence in the U.S., and therefore claimed not to be legally obligated to respond to a subpoena. It seemed odd to Simpson that Browder would feel strongly enough about Prevezon to tip off the DOJ, but would be unwilling to testify to any of his accusations under oath. Fusion also gradually found Browder’s dealings in Russia to raise an increasing number of questions.
Fusion began researching Browder to help Baker Hostetler compel him to testify under oath in court about his role in the case. In 2014, Fusion determined that Browder’s hedge fund, the Hermitage Fund, was registered in Delaware, proving that he did in fact have a U.S. presence. Shortly after Fusion made this discovery, Browder took his name off the registration, claiming that it had been there by mistake.
Browder also claimed to own no property in the U.S., but Fusion discovered that Browder had a $10 million mansion in Aspen, Colorado, registered under the name of a shell company. Browder also owned vehicles registered at that Aspen address under his own name.
When Simpson learned that Browder would be speaking at the Aspen Institute in the summer of 2014, Fusion saw it as an opportunity to serve him with a subpoena. They hired two subcontractors to serve the subpoena in the Aspen Institute parking lot. Browder refused the subpoena, ran back to his car, and drove back to his mansion. Browder later said that the subpoena had been improperly served because he had nothing to do with the United States, and the subpoena was also improper because it was for a case in New York, but had been served in Colorado. Browder also stated that he had thought that the two men approaching him to serve the subpoena were KGB assassins coming after him.
Fusion continued its research into public records on Browder and learned that he had a number of shell companies in Cyprus and other tax havens around the world. Simpson believed that Browder was using these shell companies to channel money into Russia and to hold Russian securities. When the Panama Papers came out in 2015, Fusion also learned that in 1995, Browder had incorporated an offshore shell company in the British Virgin Islands, and had later transferred the shares from the Hermitage Fund to this shell company.
According to Simpson, “one of Putin’s primary rules for business was you can do a lot of things, but you’ve got to pay your taxes.” Simpson believes that Browder’s tax evasion in Russia was how Browder began to fall out of favor with Putin. Putin’s government prosecuted some of Browder’s shell companies and forced Browder to make a massive tax payment in 2006 [in the amount of $230 million].
During the course of Fusion’s investigation in the Prevezon case, Fusion GPS and Baker Hostetler shared information back and forth, with Baker being the central repository for information. Simpson trusted the integrity of the information that he received from Baker, due to the quality of their information on past projects. Fusion did not do any research to verify the information from Baker because “that would have been an enormous task and it would have made no sense,” since Baker was the client for whom Fusion was gathering and researching information. [Note: this means that it is possible that some of Baker’s info came from Prevezon or from Veselnitskaya without being verified.]
Baker Hostetler directed Fusion to be available as an information source to answer reporters’ questions and to actively contact the press to encourage coverage of the Prevezon case. Simpson recalled providing information to Bloomberg, New York Times, Wall Street Journal, Legal 360, Financial Times, NBC, and probably Reuters, Politico, and New Republic.
William Browder turned out to be an “especially aggressive media self-promoter and promoter of his story,” so most of Fusion’s interactions with the press were reactive – responding to news outlets pursuing negative stories about Prevezon based on the story that Browder had already told the press: “a lot of what we were doing was simply responding to his wild allegations, unsupported wild allegations.” Simpson would raise questions about Browder’s credibility, pointing out to reporters that Browder was unwilling to testify to his statements in court under oath, and that he ran whenever Fusion tried to subpoena him.
Simpson peripherally knew Rinat Akhmetshin (former Russian intelligence officer, now an American lobbyist hired by Natalia Veselnitskaya to help persuade Congress to repeal the Magnitsky Act). Simpson had originally met Akhmetshin years earlier while working at the Wall Street Journal covering some stories about Kazakhstan. Akhmetshin had mentioned at that time that he had had a low level position in Russian intelligence, but Simpson was not aware of any current connections between Akhmetshin and Russian intelligence or the Russian government. In light of recent new reports, Simpson is interested to know if Akhmetshin is connected to the Russian government. Simpson was aware that Akhmetshin periodically still went to Moscow.
Akhmetshin had never hired Fusion or vice versa. Akhmetshin attended a handful of the Prevezon meetings at Baker Hostetler, but Simpson was unclear on what his role was. Baker directed Fusion to pass some of its research on to Akhmetshin, and that information was likely used in turn to help Akhmetshin in his anti-Magnitsky lobbying efforts for Veselnitskaya through her organization, HRAGI.
Ed Lieberman, an attorney specializing in international taxes, was hired by Baker Hostetler to look into tax evasion issues by William Browder and Hermitage Capital. Simpson believed that Lieberman had known Rinat Akhmetshin from college. Lieberman was now also working with Akhmetshin to lobby Congress to repeal the Magnitsky Act. Simpson was not aware of any ties between Lieberman and the Russian government.
During the course of the case, Simpson met Veselnitskaya several times. Initially, he communicated with her through Baker Hostetler about Prevezon’s extortion case against Baranovsky. Baker attorney Mark Cymrot had mentioned to Simpson that Veselnitskaya had been a prosecutor in Russia Simpson had no knowledge of her possibly being an agent for the government of Russia or Russian intelligence.
After the initial communications, Simpson saw Veselnitskaya in courtrooms and at a small handful of dinners, most of which were organized by Cymrot. Simpson spoke very little with Veselnitskaya beyond simple cordialities, because she does not speak English and he does not speak Russian.
One of the dinners was in New York on June 8, 2016, and was a dinner for people working on the Prevezon case. Veselnitskaya was at that dinner. Baker attorney John Moscow may have been there as well.
The next day, June 9, Simpson attended a court hearing in the Prevezon case. Veselnitskaya was there, possibly with Rinat Akhmetshin and translator Anatoli Samochornov. After the hearing, Simpson met with some PR people from Weber Shandwick, and then went home to his family.
[That same day, June 9, Veselnitskaya, Akhmetshin, Samochornov and others met at Trump Tower in New York with Trump Jr., Manfort and Kushner. The stated purpose of that meeting had been to provide the Trump campaign with dirt on Hillary Clinton. According to Trump Jr., Veselnitskaya just wanted to talk about Russian orphans. Simpson had no awareness of that meeting at the time.]
On June 10, Mark Cymrot held a social dinner at Barcelona restaurant in Washington DC for a group of his friends. Simpson and his wife attended the dinner, and Veselnitskaya was there as well. Simpson was sitting at the opposite end of the table from Veselnitskaya, and there was “not a lot of chit-chat” between them due to the language barrier and physical distance.
After news of the Trump Tower meeting broke in the New York Times, Simpson spoke with others working on the Prevezon case (not Veselnitskaya or Akhmetshin), including Mark Cymrot, Ed Baumgartner, and Baker attorney Paul Levine, and they too were very surprised about the Trump Tower meeting. Simpson wondered if some of the information shared there had been information that he had gathered for the Prevezon case.
Simpson’s perception of Veselnitskaya was that she was “a very smart and ambitious lawyer, but not like a big political player in the Kremlin.” He recalled her regularly having problems with her visa being accepted to get into the United States.
Simpson recalls meeting Denis Katsyv, the owner of Prevezon, at a handful of meetings or client dinners, but they did not speak much – again due to the language barrier. Prevezon was described to Simpson as Baker Hostetler’s client, and Denis was introduced as Prevezon’s owner. Cymrot told Simpson that Baker had already looked into Katsyv and determined that he was a legitimate businessman who invested in real estate. Simpson accepted this assessment as credible due to the reputation of Baker Hostetler and his past dealings with them. Simpson never met Denis’s father, Pyotr, a Russian government official, and did not know about him until Fusion had to start responding to Browder’s accusations.
Simpson acknowledged knowing Chris Cooper, a public relations person [at the Potomac Square Group] who used to work at the Wall Street Journal. Simpson would occasionally refer PR work to Cooper, and encouraged Baker Hostetler to hire him to do PR work for Prevezon during the money laundering trial.
Cooper created what Browder alleges is a “fake documentary” about Browder and Magnitsky. When Cooper sought to screen the film, Browder hired an aggressive attorney and threatened a libel lawsuit against anyone offering to show the film. Newseum – a Washington DC museum dedicated to journalism and the First Amendment – was not intimidated by Browder and showed the film on June 13, 2016, just days after Veselnitskaya’s meeting at Trump Tower.
Simpson was unclear whether Prevezon or HRAGI was behind the showing, but Fusion GPS provided names of journalists and others to be added to the invitation list, and Simpson may have personally invited some journalists as well, because the film questioned Browder’s credibility, and Browder’s media efforts had been hampering Fusion in their work for Baker on the Prevezon case.
Simpson stated that he was only peripherally involved with HRAGI and did not recall any interactions with the organization. Simpson acknowledged knowing and having lunch once with Lanny Wiles, a well-connected Republican consultant and lobbyist who may have been working for Prevezon or HRAGI.
Simpson was only vaguely aware of HRAGI’s lobbying efforts. He did recall Akhmetshin or Cymrot mentioning a meeting with Paul Behrends, a Congressional aide to U.S. Representative Dana Rohrabacher (R-CA). [Rohrabacher has been an outspoken defender of Russia and a loyal Trump ally, and Behrends, the main contact on Capitol Hill for Veselnitskaya and Akhmetshin, has an interesting history in Washington DC: in a matter of just a couple years, Behrends went from being a fierce hawk against Russia to being a cheerleader for them] [Politico]. There was also e-mail evidence of a meeting with U.S. Representative French Hill (R-AR). Simpson did not believe that HRAGI or Prevezon were connected with the Russian government.
Simpson did not personally know Emin Agalarov, Aras Agalarov, or Rob Goldstone, although he knew who they were. [Goldstone arranged and attended the Trump Tower meeting, allegedly prompted by the Agalarovs] Neither Simpson nor Fusion had ever paid or been paid by any of them, and Simpson did not believe that any of them were working with Prevezon.
Since the election, there have been attempts to hack into Fusion GPS’s communications system. Simpson’s attorney Levy, present with Simpson during his testimony, stated that Fusion has received death threats. When Simpson was asked a question about his sources, Levy said that “Somebody’s already been killed as a result of the publication of this dossier and no harm should come to anybody related to this honest work.”
Simpson was asked a number of questions pertaining to names of his clients, communications with his clients, and naming sources of information – topics which the Senate Judiciary Committee had apparently agreed in advance not to go into. At the advice of his attorney, Simpson declined to answer those questions.
What did Glenn Simpson tell the House Intelligence Committee about the Prevezon case that he did not already say in his Senate testimony?
Baker Hostetler is one of Fusion GPS’s oldest clients. Fusion has done 4-5 projects for them. Simpson describes them as a Republican-oriented law firm of “very serious, sober, reputable attorneys.”
Regarding the Prevezon case, Baker approached Fusion in late 2013 to determine whether it was provable that money from a specific fraud in Russia had gone into some specific real estate projects in New York. Baker attorney John Moscow led Simpson through the financial information of the case, and persuaded Simpson that the money trail between the Russian fraud and New York properties was not clear. Baker retained Fusion in early 2014.
The first thing that Fusion did was to investigate Prevezon. Natalia Veselnitskaya was introduced to Simpson in mid-2014 as a former Russian government lawyer who had retained Baker on behalf of Prevezon. She had told Baker Prevezon’s story about being blackmailed by Russian organized crime figure Baranovsky, who had been jailed for extortion. Baker passed Veselnitskaya’s story to Fusion. Fusion checked the story out, and it appeared to be true.
Fusion then wondered how allegations from a jailed criminal in Russia had gotten to the U.S. Department of Justice. Baker subpoenaed an ICE agent who informed them that they had gotten the information from William Browder.
In addition to Browder’s mansion in Aspen, Colorado, Fusion also uncovered that he had a house in New Jersey. In addition to trying to serve Browder with a subpoena in Colorado, Fusion tried to serve him another time, and then again in New York outside the Daily Show. That attempt at a subpoena was videotaped, and Browder ran down the street without taking the paper.
Simpson’s House testimony contained a few miscellaneous details elaborating on his previous Senate testimony:
Ed Baumgartner, who worked on both the Prevezon case and the Trump project, traveled to Russia with the lawyers as part of his work on the Prevezon case. Simpson did not go to Russia.
In researching Denis Katsyv for the Prevezon case, Simpson did not find Katsyv to “have a media profile of an oligarch” – no mafia connections, no meetings with Putin, no denial of visas to the U.S. However, Denis’s father, Pyotr Katsyv, is a Russia government official.
Browder’s shell companies based in Cyprus likely included Giggs Enterprises Limited, Zhoda Limited, and Peninsular Heights Limited.
The Russians regularly do fake news stories on Browder and have even done a documentary accusing him of murder.
At the Prevezon hearing on June 9, 2016, the day of the Trump Tower meeting, former U.S. Attorney General Michael Mukasey argued on behalf of Prevezon as their appellate lawyer.
Much of the House Intelligence Committee’s Prevezon-related questioning focused on three things: the period around the time of the Trump Tower meeting, specific information from Simpson’s Prevezon research, and the flow of that information.
According to one of Simpson’s House Intelligence Committee questioners, when Veselnitskaya was at the Trump Tower meeting on June 9, 2016, she presented information about William Browder and the Magnitsky Act. Simpson had read news accounts of that.
Regarding Simpson’s own activities on June 9, after attending the Prevezon hearing (where Veselnitskaya was present), Simpson met with Shandwick public relations “at a hotel somewhere” to explore having them do PR work for the Prevezon case.
The next time that Simpson saw Veselnitskaya was at the dinner in Washington DC organized byBaker attorney Mark Cymrot. During this second testimony, Simpson could not recall if the dinner was on June 10 or 11.
Committee questioners showed Simpson an October 27, 2017 New York Times article, “Talking Points Brought to Trump Tower Meeting Were Shared With Kremlin” [New York Times] as well as a memo from the office of Yuri Chaika, Russia’s Prosecutor General. According to the Times article, Veselnitskaya’s Trump Tower talking points largely matched the memo from Yuri Chaika – in some cases paragraph for paragraph.
[The e-mail to Trump Jr. that sparked the Trump Tower meeting had promised information on Clinton from the “Crown Prosecutor of Russia.” Journalists and others had initially interpreted this to be an exaggerated/inaccurate description of Veselnitskaya, but it was more likely referring to Chaika.]
[Veselnitskaya’s talking points (New York Times) focused on Browder and the Magnitsky Act, but also included allegations that two major Democratic donors – New York billionaires the Ziff brothers – had committed fraud and tax evasion by illegally investing through William Browder’s company and not paying taxes (amounting to millions of dollars) to Russia on the investment. Putin claimed that the U.S. government was ignoring these allegations against the Ziff Brothers because they were major political donors. Veselnitskaya asserted that the alleged tax evasion tainted any potential donations to Clinton from the Ziff brothers. This was her “dirt” on Clinton.]
[Chaika’s memo had been given to pro-Russia U.S. Representative Dana Rohrabacher (R-CA) during an American Congressional delegation to Moscow in April 2016. Veselnitskaya and Chaika were known to have communicated in the months before the June 9th Trump Tower meeting, and worked together to provide the info on Browder and the Ziff brothers to Rohrabacher. Veselnitskaya later got the same info to U.S. Representative French Hill (R-AR). Veselnitskaya then asked Aras Agalarov to help her set up the meeting at Trump Tower to present the information.]
Simpson’s research on Browder had also included information on the Ziff brothers. Baker Hostetler would have given that information to Veselnitskaya for the Prevezon case.
Simpson did not believe that Veselnitskaya was sharing that information with the Kremlin or acting on behalf of the Russian government. Simpson did not recall if she had ever told him that she knew Prosecutor General Yuri Chaika, but she “may have alluded at times to giving information to the [Russian] government for purposes of tax law enforcement” to recover unpaid taxes.
Simpson acknowledged that, because Browder was antagonistic toward both Prevezon and Putin, Putin would likely have been more supportive of Prevezon’s side in the Prevezon case.
As an explanation for how Fusion’s research ended up being used in the Trump Tower meeting, Simpson said:
“In retrospect, I think what might have happened was that – so when the case started it wasn’t about William Browder. It was about a technical argument about whether you could prove that money from something in Russia went into this real estate development. And so it didn’t have a political dimension to me particularly, it was a technical argument. And that is how the case was introduced to me, and the fight was going to be over what the bank records showed.
“So it was a reasonably interesting case, but not very potentially controversial. But as we went into discovery, you know, the discovery trail led to Vladimir Putin’s biggest critic [William Browder].” [This ultimately resulted in Simpson doing work that could be repurposed to oppose the Magnitsky Act.]
“My view is that when we started producing actual information in court that was embarrassing to [Browder], and tended to raise questions about [Browder’s] activities in Russia, that [Veselnitskaya and ultimately Chaika and Putin] opportunistically began to exploit that.
“And that would fit with my view of Ms. Veselnitskaya as well, which is that she viewed the success that we had in finding certain kinds of information as a ticket to political advancement in Moscow. There is only one way up in Russia, and that is to do something that impresses Vladimir Putin.” Developing a relationship with a potential President of the United States would also be a way to impress Putin.”
Simpson was proud of the information that he had gathered in the Prevezon case, but disagreed with the pro-Putin slant that Veselnitskaya added to it in her Trump Tower talking points.
Asked if it bothered him that the information from his research had been used in what he himself at one point in his testimony had described as a Russian Government-directed operation, Simpson stated:
“It all happens to be accurate. And so, you know, if someone used this research that they, you know, commissioned through a law firm for a legitimate legal purpose, took it and repurposed it in some other way, I can’t say as I am upset by that. I must say in my business, right, I am in the information business, so when people commission research from you, it becomes their property when you are finished with the research, when you give it to them. So if they decide to go and use it for something else, I mean, that’s just beyond my control. So I will add that, you know, as someone who is not a fan of Vladimir Putin, I don’t take any great – I certainly am not happy to do anything that anyone would think was helping Vladimir Putin. And so to the extent that this has subjected me to an unfair accusation that I was engaged in some kind of Kremlin operation, I find that very regrettable.”
Simpson’s testimony sharply contradicts some of Browder testimony, and paints Browder as a more complex figure than Browder’s portrayal of himself as a wrongly persecuted anti-corruption crusader. Browder’s various shell companies in tax havens around the world muddy the waters of Browder’s story considerably. Was Browder’s $230 million in taxes in fact paid to the Russian government, as Browder claims, and then stolen by the government and laundered overseas for the benefit of Putin and others (creating a pretext for turning Browder into a fugitive)? Or was Browder truly guilty of tax evasion, using his shell companies to hide the money, as the Russian government accused him of? Or is the answer something in between? Regardless, one comes away from Simpson’s testimony with a more multi-dimensional understanding of Browder.
Browder’s evasiveness and unwillingness to testify under oath are somewhat consistent with Browder’s story. If Browder truly is considered by Putin to be a major enemy – a likelihood that seems to be agreed upon by all – it is reasonable for him to be fearful when seeing two strange men approaching him in a Colorado parking lot or on the streets of Manhattan, and it is reasonable for him to be cagey about putting himself in a well publicized location like a courtroom, where he could potentially be assassinated upon entering or leaving. According to accounts of Browder’s Senate testimony, he showed up flanked by two large bodyguards. [Esquire]
Yet Browder has also willingly spoken at publicized events, like his appearance at the Aspen Institute, so his wariness and overabundance of caution seems to be selective.
The major takeaway from Simpson’s testimony about his Prevezon work, however, is that information gathered by Fusion GPS ended up being used by a likely Russian operative, Natalia Veselnitskaya, and ultimately by Russian Special Prosecutor Chaika, to further the interests of the Russian government. That was how the information was used in the Trump Tower meeting, and how it was used in lobbying efforts with U.S. Congresspersons Rep. Dana Rohrobacher (R-CA) and Rep. French Hill (R-AR).
The most important question is whether or not Simpson was aware that Fusion’s research was going to be used in that way and whether or not Simpson provided the research information to someone that he knew was a likely Russian government operative.
The explanation that Simpson gives for how things evolved seems very plausible, and I personally believe it: the case started out as a normal case of technical research, Browder came up in that technical research, and behaved in an actively antagonistic yet evasive way that raised questions. Browder’s actions prompted further investigation into him and his business ties, which produced incriminating information. Veselnitskaya, recognizing the value of that information to her career in Russia, opportunistically took it to the Russian government, who began making use of her and the information to undermine the Magnitsky Act – a major personal goal of Putin’s. In such a situation, where a reputable, conservative law firm with a known track record of prudence had introduced Simpson to Veselnitskaya merely as a lawyer, it was reasonable for Simpson to take that initial understanding of who she was at face value, and to not anticipate the possibility that during the course of the case, she would become an operative for the Russian government.
In general, Simpson appeared to be extremely forthcoming in both of his lengthy, voluntary testimonies, often answering questions with far more thoroughness than required, and at times even including names and dates without prompting.
However, Simpson’s haziness about the events around June 9, 2016 seems inconsistent with his detailed recollection of the events and characters of the Prevezon case (and of Trump’s background). Most notably, regarding his own actions, Simpson seemed unclear about the exact reason that he had gone home on June 9. In the Senate testimony, he said “My son’s junior prom was that night or senior prom and I was under some pressure to go home and be a dad” (p. 260-261). In the House testimony, he said “it was my son’s high school graduation. It was an event for my son’s high school graduation” (p. 121). He also said in the Senate testimony that the Washington DC dinner that he and Veselnitskaya attended was on June 10, and in the House testimony he said that it was on June 10 or 11.
This foggy recollection could be easily attributed to Simpson being more engaged in his research work than in his personal life. Yet given that his actions during this particular time period are crucial to understanding his involvement with Veselnitskaya and her Trump Tower meeting, one would think that he would have looked through his own calendar book and other records between the Senate and House testimonies so that he could give a clearer answer.
Nonetheless, it is also worth noting that in over 16 hours of testimony – 10 without having sworn an oath, then six under oath – with at times aggressive questioning, these were the only inconsistencies between his first and second testimony, and they are not even inconsistencies, but merely an inability to remember exact details of his own life from two specific days that had been over a year in the past by the time he was first asked to account for them.
– rob rünt
Read more of this special series:
The Trump-Russia Web
Disclaimer: This is a summary of William Browder’s testimony before the Senate Judiciary Committee on July 26, 2017. The information below was presented by William Browder in his testimony, and is not being represented here as either fact or as the opinion of the webmaster unless specifically stated. All statements and assertions should be read as if prefaced by “William Browder states that …” Any content that I add will be surrounded by [brackets] and will likely include a link or reference to the source.
Browder was born in Chicago, and is now a British citizen. He has lived in London and Moscow for the past 28 years. He founded Hermitage Capital Management, a major investment advisory firm in Russia, which in 1996-2005 had over $4 billion in Russian stocks.
As owner of a major finance firm, he began learning that Russian oligarchs steal from shareholders, including from Browder’s fund, the Hermitage Fund. To fight this corruption, he began researching how these oligarchs were stealing the money. He would then pass the information on to the Russian news media.
Although Browder never met Putin personally, Browder’s efforts were supported and even assisted by Putin, because the oligarchs had “misappropriated much of the president’s power as well,” and Putin was just beginning to consolidate his own power.
In 2003, Putin arrested and jailed Russia’s richest man, Mikhail Khodorkovsky, and staged a dramatic and humiliating televised show trial to make a public example of him. After that, the other Russian oligarchs came to fear Putin. Putin began demanding a 50% cut of the money that they were stealing, and Putin was no longer supportive of Browder’s anti-corruption efforts, which would now negatively impact Putin’s intake.
On November 13, 2005, Browder was detained and deported from Russia as a “threat to national security.” Eighteen months later, the Russian Interior Ministry raided the Moscow office of Hermitage Capital Management and Browder’s attorney and seized “all the corporate documents connected to the investment holding companies of the funds that I advised.”
Browder hired attorney Sergei Magnitsky to investigate what the officials were doing with these documents. Magnitsky determined that the documents were being used to re-register Browder’s holding companies to a convicted murderer named Viktor Markelov, and $230 million in taxes paid to the Russian government by Browder’s companies had been diverted elsewhere. [Note: Prevezon Holdings was accused by the U.S. Department of Justice of laundering millions of dollars in New York real estate, using money from a $230 million Russian tax fraud scheme. Prevezon settled out of court for $5.9 million without admitting guilt.]
Browder and Magnitsky notified the Russian authorities of what was going on, but instead of arresting those responsible, the authorities arrested and jailed Magnitsky. He was in prison for nearly a year under unusually horrible conditions, during which time, he was pressured to withdraw his testimony and sign a statement that he had stolen the money on instruction from Browder. Magnitsky refused.
Magnitsky’s health deteriorated dramatically in prison. He developed pancreatitis and gallstones which required surgery, but was instead transferred to an extremely harsh prison called Butyrka where no such treatment was available. His condition became critical. Magnitsky was transferred to another prison, was chained in an isolation cell, and was beaten to death by eight guards on November 16, 2009.
Browder, feeling responsible because Magnitsky had died defending him, vowed to avenge Magnitsky’s death. Magnitsky had documented all of the abuse during his time in prison in handwritten notes secretly passed to his attorneys. When this evidence was brought to Russian authorities, nobody was prosecuted. Instead, many responsible were given promotions.
Browder believed that the $230 million was likely in the west, where other Russians could not steal it. He decided to seek justice by getting the western assets of Magnitsky’s tormenters frozen and their visas to enter the United States denied.
In 2010, Browder began lobbying Senators Benjamin Cardin (D -MD) and John McCain (R-AZ) to create the Magnitsky Act, to freeze the western assets of specific Russian individuals and ban their visas. In late 2012, the act passed both houses of Congress and was singed into law by President Obama.
Putin responded with various retaliatory measures, including imposing a ban on American adoption of Russian orphans. Browder believes that Putin’s outrage was in part because Putin had ultimately been the personal recipient of Browder’s missing $230 million. Putin’s closest childhood friend, Sergei Roldugin, who Browder believes was acting as an agent for Putin, was shown in the Panama Papers to have received $2 billion from various Russian oligarchs. Part of this money was Browder’s $230 million. Because this particular money ultimately led to the death of Sergei Magnitsky, Putin is subject to the restrictions of the Magnitsky Act. Putin’s wealth is estimated at $200 billion, and much of it is in western countries, so Putin has a personal reason to want the Magnitsky Act repealed. The act also weakens Putin’s control over wealthy Russian oligarchs.
A Russian named Boris Nemtsov helped Browder advocate for the Magnitsky Act. In 2015, Nemtsov was murdered on a bridge in front of the Kremlin. Another Magnitsky Act advocate, Vladimir Kara-Murza, was poisoned in December 2016 and barely survived. Another Magnitsky Act advocate, the lawyer for Magnitsky’s mother, Nikolai Gorokhov, was thrown from the fourth floor of his apartment building in early 2017 but survived. Browder himself has also received multiple death threats from Russia, and the Russian government has also tried to arrest him multiple times using Interpol and other law enforcement.
Browder believes that wealthy Russians Pyotr Katsyv and Denis Katsyv, Natalia Veselnitskaya (the lawyer who met with Trump Jr., Manafort and Kushner at Trump Tower) and a group of “American lobbyists” began a campaign in the U.S. to repeal the Magnitsky Act or to have Magnitsky’s name removed from the Act.
Pyotr Katsyv is a high level Russian government official. His son Denis was caught using what Browder believes was part of his $230 million to purchase Manhattan real estate to launder the money. Veselnitskaya is the Katsyv’s attorney.
Veselnitskaya hired New York law firm Baker Hostetler to lobby Congress to remove Magnitsky’s name from the Magnitsky Act. Through that law firm, she also hired Fusion GPS to “conduct a smear campaign against me and Sergei Magnitsky in advance of congressional hearings on the Global Magnitsky Act.”
Fusion GPS told U.S. media that Magnitsky “was not murdered, was not a whistle-blower, and was instead a criminal.” Veselnitskaya hired marketing firm Potomac Group to create a fake documentary to discredit Browder and Sergei Magnitsky, a huge screening of which was held at the Newseum in Washington DC. Howard Schweitzer of Cozzen O’Connor Public Strategies and former Congressman Ronald Dellums – both of whom had been hired by Veselnitskaya to lobby Congress to repeal the Magnitsky Act – funded the screening and invited members of Congress to attend.
Browder believes that all of these activities were violations of the Foreign Agent Registration Act, requiring entities engaged in political or quasi-political activities in the U.S. on behalf of foreign governments to register and disclose their activities, finances, and their relationship with the foreign government. Browder has filed a complaint with the U.S. Department of Justice stating that many of the groups and individuals above violated FARA.
Browder’s testimony paints an overall image of rampant corruption in Russia, where oligarchs scam investors and Putin takes a cut of the oligarchs’ illicit gains. The testimony also makes clear that Browder is at the center of the creation of the Magnitsky Act, which currently prevents Putin and a number of other wealthy Russians from accessing their assets in the west. Putin had retaliated for the Magnitsky Act by, among other things, banning adoption of Russian orphans by Americans.
Given that the obscure subject of Russian adoption seems to come up repeatedly in interactions between Trump’s people and Russians, it is reasonable to assume that there are efforts to persuade Mr. Trump to repeal the Magnitsky Act so that Putin can once again access his frozen U.S. assets.
When Russian lawyer Veselnitskaya met with Donald Trump Jr., Paul Manafort, and Jared Kushner at Trump Tower with the promise of dirt on Hillary Clinton, Trump Jr. later claimed that the discussion was merely about Russian adoption
Similarly, when Trump spoke with Putin at the G20 meeting [Vox] , Trump claims that they primarily talked about Russian adoptions.
Browder’s testimony also brings Prevezon Holdings into the forefront of the issues surrounding the Magnitsky Act, accusing them of helping launder $230 million in taxes that he claimed he paid to Russia, but which the Russian government later claimed was not paid by Browder. Russian attorney Sergei Magnitsky died in prison trying to help Browder prove his case. Part of Browder’s efforts to allegedly avenge Magnitsky involved informing the U.S. Department of Justice that Prevezon was engaged in money laundering in New York.
Browder claims that law firm Baker Hostetler (hired to defend Prevezon), Fusion GPS (hired by Baker Hostetler to gather research supporting Prevezon’s court case), and a number of other organizations were involved in a campaign to repeal the Magnitsky Act. He also claims that those organizations, as well as Natalia Veselnitskaya, were operating on behalf of the Russian government. If so, their anti-Magnitsky campaign work would be a violation of FARA, because they had not registered to disclose that they were working on behalf of the Russian government.
Fusion’s production of the Trump dossier, if done as unregistered agents of the Russian government, could have been part of Russia’s campaign to influence the 2016 Presidential election. Creation of the Trump dossier would of course not be intended to sway the election toward Trump. The intent would instead be to sow discord, chaos and distrust in the election among the American people – goals that would be consistent with Putin’s. Yet Fusion GPS’s Glenn Simpson, whose testimonies are covered later in this series, comes across as an extremely straightforward, credible and forthcoming witness, which would tend to negate the idea of Fusion as being in league with the Kremlin.
Because of the possibility that Fusion was acting on behalf of the Russian government, Republicans on the Senate Judiciary Committee and House Intelligence Committee interviewing Simpson focused on Fusion GPS’s work on the Prevezon case.
– rob rünt
Read more of this special series:
The Trump-Russia Web
What You Don’t Need to Know: Understanding Intelligence and Law Enforcement Regarding Trump
We are likely to hear plenty of testimony before Congress from law enforcement and intelligence officials in the coming months. People who see Donald Trump as corrupt or worse may find themselves frustrated by what appears to be an attempt by these officials to hide key information from Congress and from the public. Some Americans may even begin developing conspiracy theories about these officials’ silence or apparent evasiveness under oath.
It is possible that some individuals in the FBI, Secret Service, NSA, CIA, etc. may be inappropriately trying to conceal incriminating information about the President. However, when law enforcement or intelligence people conceal such information from Congress in open testimony, it is almost certainly not an attempt to protect the President. Rather, it is an attempt to protect the investigations into his campaign and administration from becoming compromised, because they want to ensure that any wrongdoing can be prosecuted with the best evidence possible when and if arrests are made.
Law enforcement and intelligence have obligations that at times can be hard to balance. They are supposed to serve the American public, which in the minds of many means that the public has a right to know everything that is going on in an investigation, what evidence has been compiled so far, how it was discovered, and all other important information. Americans want to quickly and definitively know, in the words of Richard Nixon, “if their President is a crook,” and they certainly don’t want a crook to stay in office if law enforcement have strong reason to believe that the person is corrupt in some way.
But law enforcement and intelligence personnel are also supposed to serve the American public by doing their job, by “getting the bad guys,” by performing as thorough an investigation as they can, by ensuring that their evidence is as airtight as it can be, by preventing crimes, sabotage, and foreign intelligence operations from being successful in the future. That means that not everything that they know can or should always be disclosed to the public all the time.
The audience for public statements from law enforcement and intelligence is not only the American public. Criminals being investigated are paying attention as well. People considering committing future crimes are paying attention. In the Russia investigation, the Russians are paying attention. Other hostile countries are paying attention. It is important not to give them useful information.
For this reason, there are things that law enforcement officials may be reluctant to disclose publicly, particularly in the middle of an active investigation, including:
Who is under surveillance
What facts, testimonies and evidence have been gathered so far
Who are the witnesses, informants or undercover agents
What don’t law enforcement currently know
What evidence don’t they have
How is information being collected/what techniques are being used
What is their strategy for getting the needed evidence or making an arrest
Any sensitive/classified/secret information
Conclusions that law enforcement have reached so far
Prematurely disclosing such information can damage an active investigation in many possible ways. It can enable a criminal to better know how to cover their tracks, who to stop trusting, who to kill to prevent testimony in court, what not to lie about under oath, or any number of other issues that can complicate or even completely ruin an investigation. That information is appropriate to reveal in court after the arrests, and much may be appropriate to reveal publicly as well at that time, but not during the investigation.
Similarly, there are things that intelligence officials may be reluctant to disclose publicly, especially in the middle of their operations or investigations, including:
Who or what their sources of information are (or things that could enable someone to figure that out)
What they know about other foreign powers (or how they know it)
What they don’t know about other foreign powers (or why they don’t know it)
What tactics and techniques they use
Where they are focusing their attention
Gathering intelligence, setting up an effective surveillance operation, and gaining access to key information is very difficult. It can require extensive resources, money, talent, and in some cases years of cultivating trustworthy relationships. Once that information is revealed publicly (and therefore to the people about whom it has been gathered), it becomes far less valuable, or sometimes completely useless. For that reason, intelligence officials are very careful about what they say about their work.
Publicly disclosing information about an intelligence operation or its results – or revealing that information to the wrong person – can have severe consequences beyond merely rendering years of hard work useless. Those consequences include:
Agents or informants being killed
Hostile countries learning of previously unknown vulnerabilities of the US, American allies, or themselves
Hostile countries being able to more effectively conduct intelligence or military operations to harm the US or its allies
Military operations of the US or Americas allies becoming compromised, resulting in American troops or those of our allies being needlessly killed
Hostile countries taking military actions elsewhere in the world which they otherwise might not have
Terrorists knowing how to better avoid detection of their plans and activities
That is why Israel was so outraged – and other nations so deeply concerned – when President Trump boastfully blabbed classified information to Russian officials in the Oval Office: he had recklessy damaged an intelligence operation of an important ally, rendered the information less useful, made that ally’s future intelligence operations more difficult, and potentially put the lives of that ally’s informants or spies at risk – and for what?
Additionally, law enforcement see their own investigations in ways that may not always make immediate sense, especially during testimony or public comments.
Law enforcement treat investigations that are in progress differently from those that have been completed. An ongoing investigation requires some degree of secrecy, for reasons described above. Law enforcement consider an investigation complete when they have gathered what they believe to be all of the evidence, spoken to what they believe to be all of the relevant people involved, and come to a conclusion that the evidence collected is sufficient (or not) for a court of law to potentially determine the guilt or innocence of one or more persons. At that point, if that evidence points sufficiently to guilt, arrests are made, after which law enforcement officials feel more free to publicly discuss some of the details of the case.
An example of this would be former FBI Director James Comey’s controversial handling of the Clinton e-mail investigation. The FBI had been investigating Hillary Clinton and those around her for evidence of conscious wrongdoing in their use of a private e-mail server (potentially more open to being hacked) to transmit classified government information.
The FBI considered that investigation to have been completed in July of 2016: they believed that they had reviewed all of the evidence, and because Clinton was a candidate for President, they took the step of publicly announcing that their investigation was complete. It should be noted that the closing of that investigation did not mean that Hillary had done nothing wrong, but merely that the FBI did not have sufficient evidence to prove in a court of law that she had knowingly and intentionally done something illegal.
In October of 2016, in a separate investigation into illegal online sexual activity by former Senator Anthony Weiner (D-NY), a large number of Clinton-related e-mails from Weiner’s wife, Clinton aid Huma Abedin, were discovered on Weiner’s computer. The FBI could not be instantly certain that all of these e-mails had already been reviewed during the Clinton e-mail investigation. In other words, it was possible that the FBI had been mistaken and premature in concluding in July that they had reviewed all of the evidence.
Because a public announcement had already been made that the Clinton e-mail investigation had been closed, because it now needed to be reopened, and because it was important for the public to know that the investigation’s status had changed, James Comey took the unusual – and to many, outrageous – step of notifying Congress shortly before the election that the FBI was reopening their investigation into Hillary Clinton’s e-mail activity. Through the allocation of extra staff, time and resources, the FBI was able to quickly process the potentially new e-mails and announce before the election that they were once again closing that investigation.
It is almost certain that Comey’s decision impacted the results of the election in favor of Donald Trump, and one can question Comey’s judgment in how he handled things, but looking at it from his perspective, the outcome of the Clinton investigation had become once again not known. Had Hillary become President, and then the e-mails on Weiner’s computer had revealed that she was guilty of provably, knowingly, and intentionally committing a crime, Americans would have been demanding why Comey had concealed from them the fact that the investigation had been reopened. The outrage currently felt by many Democrats about Comey’s last-minute Hillary revelation would have been felt even more strongly by Trump supporters, who would likely have made accusations and developed conspiracy theories about how the FBI had covered for Hillary Clinton to get a Washington insider unjustly elected to protect the status quo. In other words, it was a no-win for Comey, and he made the best decision that he could in a situation where there were no good decisions.
One could ask why Comey did not give what would seem to many people to be equal treatment to the Trump investigation, which was by then underway. Why did he choose not to notify Congress, at the same time as his announcement of reopening the Hillary investigation, that the Trump campaign was also under investigation for activity related to Russia? This again was a judgment call in a situation where there were no good decisions.
At the time, the Trump Campaign did not know that the FBI was actively investigating them. Notifying Congress of that fact while the investigation was ongoing – and in truth just starting – would have damaged the investigation, potentially causing people in the Trump Campaign or the Russians to be more cautious, cover their tracks more thoroughly, stop talking to certain people, etc., all of which would have made gathering sufficient evidence for an eventual prosecution much more difficult or even impossible. The efforts by Russia were huge and sophisticated: it was absolutely in America’s best interest to conduct a thorough and effective investigation of it to prevent such activity in the future. That meant that the FBI did not want to take action that could jeopardize the investigation.
On the other hand, not telling Congress about the Trump-Russia investigation could result in America having a President whose campaign – or who himself – was influenced by or compromised by a hostile foreign power. Comey apparently believed that this was at least something that could be managed through continued monitoring of the situation by the FBI and other law enforcement. This does not mean that he made the right decision, or that he did not. It merely explains the difficult decision that he made.
Finally, when law enforcement and intelligence officials are questioned publicly before Congress, they may say things like “I don’t think that’s appropriate to discuss here” or “I can’t talk about that in open session,” they are not being underhanded. We are used to assuming a greater likelihood of guilt or shiftiness when people “plea the Fifth” under oath, but that is not what is happening here.
Some Congressional hearings are held in “open session,” meaning that the public can potentially watch, listen to, or be made aware of what is said there. Other Congressional hearings are held in “closed session.” Statements and information revealed in closed hearings may not be disclosed publicly, and may only be attended by Senators or Representatives who have been properly “cleared” (formally assessed to be capable of keeping their mouths shut).
The reason for a closed hearing is usually so that Congress (in the form of the handful of “cleared” legislators) can be notified of information that cannot be revealed publicly. In the various Trump-, Russia-, and election-related investigations, referring some subjects to a closed session is likely because disclosing such information in a public setting could jeopardize an investigation or an intelligence operation in some way.
We live in a time when trust in government is low and our suspicions high. It is natural for us to question when someone testifying before Congress appears to be concealing the truth. Understanding the perspectives and priorities of law enforcement and intelligence officials can help us better assess what we are seeing and hearing – and not seeing and hearing – from them.